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10 Factors that Drive Employee Retention

It’s hard to find qualified, high performing employees. It’s even harder to keep them.

Consider these facts: the largest demographic group in the workforce today are Millennials, those born between 1981-1996. They will represent 75% of the total workforce by 2025. On average, they stay with one company for less than 3 years, and more than 60% stay for 2 years or less. This is three times the turnover rate of non-Millennials and costs the US economy $30.5 billion annually*. The average retail business replaces 59% of its workforce every year. Replacing a minimum-wage retail employee costs $3,500 every time it happens**.

Harold Lloyd, former President & CEO of a 14-unit retail organization, restauranteur, and now speaker and author, shared his 10-point check list for assessing your Employee Retention Probability during his keynote address at the Crosset 2017 Annual Produce & Floral Conference. Lloyd contends that if you score well on these 10 factors (8 or higher on a scale of 1-10), you will never have to hire again.

  1. Pay and Benefits: are they fair and commensurate relative to the competition?
  2. Background Checks: do you do them on every single employee, regardless of position or level? Are they conducted by a reputable third-party company and thorough? Background checks are not optional. Recent court rulings have said that “if you could have known, you should have known.”
  3. Number of Interviews: best practice is to conduct at least three separate interviews. For retailers, the list should include the Store Manager, Department Manager, and Direct Supervisor. If possible, also include the Store Owner and co-workers within the department you are recruiting for. The hiring decision, however, should be made by the Department Manager, who will be closest to the employee
  4. Orientation Process: thorough, engaging, and at least 40 hours over 30 days.
  5. Communication: continuous, honest, and up and down the
  6. Discipline Process: decisive, empathetic, and progressive (Lloyd follows a 5-step process) …applied consistently to everyone
  7. Recognition Events: hold them frequently and make them meaningful. Give employees something to look forward to: birthdays, anniversaries, sales contests, etc.
  8. Annual Performance Reviews: constructive and goal-oriented “Success Plans”. They should never be done one-on-one; always include the employee, their direct manager, and their manager’s manager.
  9. Equipment/Tools: do employees have what they need to do the work and get their job done?
  10. Opportunities to Grow: cross-training, webinars, books, attending industry events, etc.

How did you score?  According to Lloyd’s research, the national average is only 44. Don’t settle for less than 70, and work hard to get to an 80 or more. If you do, you’ll never have to worry about finding and keeping a great workforce.

Learn more about things you can do to up your game in these 10 critical areas in Lloyd’s new book, Employee Retention Rules! 52 Ways to Reduce Employee Turnover.

Our thanks again to Harold for sharing his insights and perspectives on this critical topic with our 2017 Show attendees.

 

*Bureau of Labor Statistics (2016). Employee Tenure Summary [Online]. Available: https://www.bls.gov/news.release/tenure.nr0.htm

**Harold Lloyd, Employee Retention Rules! 52 Ways to Reduce Employee Turnover.

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